The
Customs Computerization project is the outcome of a systems study conducted by
National Informatics Centre and Central Board of Excise and Customs in
December, 1992 at number of Customs Houses throughout the country. A more
detailed requirements study at the Delhi Custom House in April, 1994 formed the
basis for the software requirements of ICES.

The
pilot project was launched in the year 1994-95 at Delhi Customs House which
included Electronic Data Interchange(EDI) as a key element for connecting all
the players involved in international trade with the Customs House
electronically.After the successful implementation at Delhi Custom House, the
Customs decided to extend theservice to other customs houses. ICES was made
operational for exports processing at Inland Container Depot, Tughlaqabad in
August, 1997; Sahar Air Customs, Mumbai in November, 1997; Jawahar Lal Nehru
Port Trust, New Mumbai in November, 1997; Chennai Air Customs in December,
1997; Bangalore Air Customs in Feburary, 1998; and Container Freight Station,
Patparganj in March, 1998. Right now, the system is operational at 23 sites
throughout the country.

More modules like Transshipment, Warehouse, Bonds etc were designed and
implemented in steps.

ICES/I
for processing of Bill of Entry; and ICES/E for processing of
Shipping Bills. The Exporters, Importers and Custom House Agents (CHAs)
transmit Bills of Entry, Shipping Bills and other related documents such as
Invoice, Packing List over dial-up links to the NICNET EDI Server which, in
turn, submit them to Customs computer system for clearance. The trading
community is not required to travel physically to the Custom House for
submitting the documents except at the last stage for physical examination of
goods, and for taking delivery.

The
Custom House Agents use the Remote EDI System (RES) which is a standalone
software package for preparation of Bill of Entry and Shipping Bills and other
related documents. It has been developed by NIC as part of Indian Customs EDI
System. The documents transmitted electronically over NICNET are submitted to
Customs Computer System for further processing.

ICES/I
consists of the following main modules:

Import General Manifest

Bonds

Service Centre

Licence

Appraising

Baggage

Audit

Systems Manager

Assistant Commissioner

MIS

Cash

Ex-Bond

Examination

Transshipment

DEPB/DEEC/100% EOU

Import General Manifest

ICES/Econsist the following modules:

Service Centre

Examination

Duty Drawback

Assistant Commissioner

Additional Commissioner

Preventive Officer

Licence

Export General Manifest

Systems Manager

MIS

Main
features of the system are:

Security

ICES
provides for security at all levels of access to the system. At the Service
Centre. Security features are implemented at module level. System keeps track
of any transaction carried by an user.

Help

System
includes powerful help features which can be invoked by the Assessing Officers
from their respective screens to facilitate their assessment work.

Management
and Control

ICES
allows the Collector to find out the status of any document in the system.
Controlling Officers can monitor the progress of the Customs Officers in
processing the documents and provide help in expedite the process.
Number of documents cleared at each stage can also be monitored.

Computerization ofcustoms procedures resulted in time and cost savings due to the reduced
need to prepare, handle, store and deliver customs documentation.

Improvements
in communications, access to information and the transparency of customs
processes and appeals increased the level of certainty and fairness.

A
good compliance track record resulted in faster clearance and less intrusive
verification techniques.

Importers
know the amount of duties and taxes owing as a result of the clear and
consistent rules. More efficient clearance will produce time and cost savings
and provide the certainty required to exploit modern business practices such as
“just-in-time” inventory.

Exporters
benefited from having similar customs rules and procedures apply across the
international market, thus increasing market access opportunities, while
reducing costs and complexity.

Customs
Brokers have the opportunity to refocus their services from dealing with forms
and complexity to using their expertise and knowledge to bring a new range of
professional services to clients operating in an expanding and evolving trade
market.

Carriers
benefit from faster service, lower costs and the ability to use their equipment
to its utmost capacity rather than having it delayed at Customs.

Operations

Fully
automated process with little or no intervention by either party providing a
virtual on-line scenario

Declarations can be accepted round the clock automatically, resulting in
maximum productivity

Quicker retrieval of cargo through reduction of clearance times

Reduction in manual administrative processes resulting in fewer errors and no
duplication

Harmonised business relationships with other bodies such as Ports, DGFT,
Airlines, Container Depots etc.

Time Saving

Notification of releases are speeded up as a result of the electronic releases
being generated automatically

Electronic messaging has the proven advantage of minimizing data capture which
in turn ensures less errors and quicker releases

The accuracy of data received can be incorporated into clients Track and Trace

Cost Effectiveness

Cost on
processing the documents has come down drastically.

Security and Risk Management

Security is
very vital when submitting information electronically. To compound this basic
assumption, the risks of diminished value in the real world are nothing
compared to the risks of loss in the virtual world.

Customs in particular face issues such as fraud and theft in their standard
business practice and they realize the need for a secure system.

Scheduled auditing practices within the system ensured thatto ensure that security is being implemented effectively customs have
made sure that the security requirements.
The client can be sure that their message information will not be tampered
with.

Indian Customs EDI
system is developed for better management of Custom Activities. The existing
processes were analysed in depth for re-engineering and improvement.The main achievements of the system are simplified and harmonized
procedures which has not only provided efficient and reliable environment to
the customs but also to the business communities and other agencies involved in
the trade. The business processes of the customs and the trading partners along
with their boundaries and interfaces were analyzed in depth and reengineered
from the viewpoint of

Higher
efficiency

Customer satisfaction

Lower Cost

Facilitation

Lower inventory level

Reduced turn around time

The main objectives
while re-engineering the procedures were:

All the agencies of the government should presenta single face to the user

Data once captured should be available for all the government agencies

The Importer/Exporter or their agent should interact with only one agency

Gradual transition from scrutiny of paper documents

System Appraisal for select import goods

Minimized export appraisement

Examination waiver - Green Channel

Electronic credit of drawback

Reduced documentation for export cargo

The Indian Customs EDI application is running on Sun Solaris Operating System
(V.2.5/2.6) and the database is Oracle (V.7.1/7.3). Each Customs station have
stand-alone servers for running the ICES application. The data at present is
locally stored on these servers.

Indian
Customs EDI System can accepts the documents from the trading partners in the
Electronic Format. The documents can be prepared and submitted using either the
Electronic Data Interchange or Service Centre. The Importers/Exporters and
Custom House agents can use the Graphical User Interface based package “Remote
EDI System” implemented using Visual Basic/Oracle 8 from their
offices to create the documents in the desired format and then transmitting
them over the Internet using the secure server of NIC for submission at customs
house for further processing.

The document received over the Internet at Custom house is then loaded to the
ICES after the proper validation checks.

Importers/Exporters and
CHA’s who do not have access to Internet can get their documents electronically
prepared and submitted for further processing at the Service Centre. The
Service Centre module of NIC running on
powerful Sun machine under Oracle 7.0 allows entry of data, modifications and
submission.

The data entered through EDI or Service Centre
gets validated before their storage into ICES. If errors are found, the same
are reported to the Importer/Exporter/CHA through EDI or at the Service Centre.

B. Indian Customs EDI System

Documents once
entered and submitted are then reviewed by different officers of the Custom
House at various stages of processing and final clearance is accorded on the
computer system after all the formalities are over for physical examination of
the goods at the Sheds. ICES keeps track of the officers who have handled the
documents at various stages of processing. The trail of the processing cycle is
available to superior officers at any time. The CHA, in turn, can enquire about
the status of his documents from his own system. He can view any memo or
objections on his documents as they are posted in the system.

Indian
Customs EDI System : Imports

The Bill of Entry is to be filed through the Service Center by the
Importer/CHA, who has to submit the signed declaration in a prescribed format
along with copy of Invoice and Packing List if filed through Service Centre.
The document can also be filed through the Remote EDI System.

After the data entry at the service center, a "Check List" is generated which
is to be verified by the Importer/CHA and corrected in case any error is
detected and the signed "Check List" is to be submitted in the Service Center.
In case of RES, the system validates the data and if errors are found, a
message is sent back to the party. If the data passes the check, system accepts
the data and an acknowledgment is sent to the Importer/CHA.

The
Bill of Entry then appears in the screen of the respective Group Appraiser. The
Group Appraiser then assesses the Bill of Entry on the system and marks it to
the Audit Appraiser. After the Audit is complete, the Bill of Entry appears in
the screen of the concerned Group Assistant Commissioner. After the assessment
is approved by the Asstt. Commissioner concerned, TR-6 is printed at the
Service Center for payment of duty. The Examination Order is also printed along
with the TR-6 Challan.

If
the Appraiser does not agree with the importer regarding tariff classification
/ notification / declared value etc., he can raise a query in this regard. The
Importer/CHA has to enquire at the Service Center whether there is any query in
respect of their Bill of Entry and should reply to the same through the Service
Center if there is any.

The
duty is to be paid through the designated bank.

After
payment of the Duty, the Bank enters the same into the system at a terminal at
their end. Then the Bill of Entry appears on the screen of the Appraiser
(Docks). The Importer/CHA should present a copy of the B/E alongwith duty paid
challan and other documents including invoice, packing list etc. at the time of
examination of the goods.

The
Shed Appraiser shall examine the goods and enter the examination report in the
system. After the examination of the goods is complete, the Appraiser (Docks)
would give the "Out of Charge" order on the system. Thereafter, the system will
print two copies of B/E for the importer and the Exchange Control Copies.

In
case of any discrepancy found in the docks with respect to the goods, the same
is reported to the respective Group through the system with the comments of the
Dock Officers. On the basis of the examination report and the comments of the
dock officers, the Group may revise the assessment or may raise a query.

Indian
Customs EDI System : Exporters (ICES/E)

Before
filing any Export Shipping Bill, all exporters and CHAs are required to
register with the Customs EDI System their IEC Code No., CHA Licence No. and
Authorised Dealer Code No. of the Bank through which export proceeds are to be
realised.

Those intending to file the Shipping Bill will have to present at the Service
Center a declaration in the prescribed format signed by the exporter or his
authorised CHA alongwith the copy of Invoice and Packing List.

After the data entry at the service center has been done, a "Check List" will
be generated and handed over to the CHA/Exporter who should verify the
correctness of the data entered. If any error/mistake is detected by the
CHA/Exporter in the data, they should inform the Service Center operators who
will make the corresponding correction in the data accordingly.

After the correct data has been entered into the system, the Shipping Bills
shall be processed automatically by the System on the basis of the declaration
made by the Exporters. However, the following categories of Shipping Bill are
assessed by the Assistant Commissioner (Export):

(a) Shipping Bills where the FOB value is more than Rs. 10 Lakhs.

(b)Shipping Bills relating to free trade
samples whose value is more than Rs.20,000/-

(c)
Drawback Shipping Bills where drawback amount is more than Rs. 1 Lakh.

The status of the Shipping Bill can be checked by the Exporter/CHA at the
Service Center. They should also check whether any query has been raised in
respect of their Shipping Bill. In case of any query, they should file a reply
to the query through the Service Center.

During
examination of the goods at the docks, the CHA/Exporter has to present the
Check List alongwith all original documents such as Invoice, Packing List etc.
to the Customs Officer. "Let Export" order will be given by the Appraiser if
everything is found to be in order after examination of the goods and scrutiny
of the documents.

After
the "Let Export" order is given, the printout of the Shipping Bill is
generated. The examination report printed on the Shipping Bill is to be signed
by the Appraiser, Examiner as well as the CHA/Exporter. The name and Licence
No. of the CHA should be clearly mentioned below his signature.

As
mentioned, the main objective of introduction of EDI in International trade was
to move away from customs controls to trade facilitation. Number of parties,
most of which are government agencies, are involved in a trade transaction. NIC
submitted a re-engineering proposal in 1998
to the Customs, which is subsequently implemented. The main features of the
system are :

Integration of the agencies involved in a trade transaction.

All the agencies presenting single face to the customer

Customer interact with only one agency as far as possible

Data once captured made available to other agencies.

This has been
achieved primarily by re-engineering the processes of these regulatory agencies
involved. The internal functions of these agencies are automated and are made
EDI capable. The inter-agency data files are automatically transferred and
received by the system and act upon the messages receivedand the response messages are generated.

The
main agencies other than Custom House and CHA/Importer/Exporterintegrated
into the Customs EDI Community System are